More whistleblowing in the halls of Congress and other news of the week. 

Rep. Elijah E. Cummings, chairman of the House Oversight Committee,  issued a statement this week in honor of the 30th anniversary of the Whistleblower Protection Act (WPA).

“We honor the contributions of the brave men and women who report wrongdoing despite great risks to their careers and personal lives as a result of retaliation.  Without the WPA, very few whistleblowers would be willing to come forward.  Congress relies on the WPA to fulfill its Constitutional duty to provide checks and balances on the Executive Branch—the very root of our democracy.”

He noted the role of whistleblowers in the Committee’s investigation into reports of White House efforts to transfer sensitive U.S. nuclear technology to Saudi Arabia.

The Atlantic reported last week that “small army of whistle-blowers from across the government has been working in secret with the House Oversight Committee to report alleged malfeasance inside the Trump administration. Lawmakers and aides are reluctant to discuss information they have gleaned from anonymous government tipsters in detail. But the list of whistle-blowers who either currently or previously worked in the Trump administration, or who worked closely with the administration, numbers in the ‘dozens’,” according to an aide to Cummings, a Maryland Democrat.

NPR also reported on the anniversary of the WPA.

ROBERT MACLEAN: Everybody in my neighborhood and my family thought I was insane and I was fighting a futile fight.

…That’s how it felt for Robert MacLean, a federal air marshal who, in 2003, told the public that the TSA canceled air marshal coverage on long-haul flights to cover budget shortfalls.


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Whistleblowers helped the IRS collect more than $1.4 billion in criminal fines, civil forfeitures, and reporting violations in fiscal year 2018, according to an agency report released Wednesday.

Of that record amount, more than $300 million went to IRS whistleblowers – an average of 21.7 percent of proceeds collected.  That’s an increase from fiscal year 2017, when the average reward was 17 percent.

It was a record setting year in proceeds collected and award amounts paid, according to Lee D. Martin, director of the IRS Whistleblower Office. Since 2007, the program has made more than $800 million in whistleblower awards based on the collection of $5 billion.

In a written statement, Stephen M. Kohn, president of the National Whistleblower Center, called the report “the best news of the year for whistleblowers.”  The IRS program is now working well, he wrote. “Whistleblowers who witness tax frauds will be encouraged to take the risk, and report the crimes. This is game changing.”


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Alex-Sasha-Chepurko-whistleblower-interview
Whistleblower on CBS show

On Friday, August 31, CBS News will air a segment featuring biofuels fraud whistleblower, Alex “Sasha” Chepurko on the season finale of Whistleblower.  The episode, Case of “THE 100 Million Dollar Scam”, details Chepurko’s incredible story of blowing the whistle on a nationwide biofuels scam.
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DOJ withdraws appeal in criminal tax whistleblower case; whistleblowers to obtain US$12.9 million award

WASHINGTON, D.C. | MARCH 29, 2018—The U.S. Court of Appeals for the District of Columbia Circuit today will dismiss an appeal filed by the U.S. Department of Justice (DOJ) and Internal Revenue Service (IRS) challenging the right of whistleblowers to obtain a financial reward based on disclosing information that results in the criminal prosecution of tax evaders. The case concerned a major international financial institution that was sanctioned for illegally assisting U.S. citizens in evading taxes. The IRS had initially denied an award to the two whistleblowers.  The whistleblowers challenged the denial in Tax Court and prevailed.  However, the DOJ and IRS challenged this finding in the Court of Appeals. Today, at the request of DOJ, that appeal will be dismissed, and the two whistleblowers will become the first persons to obtain an IRS whistleblower reward based on a criminal tax prosecution.


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The Justice Department is appealing the Tax Court’s decision in Whistleblower 21276-13W v. Commissioner and Whistleblower 21277-13W v. Commissioner, 147 T.C. No. 4 (2016). This case arose after two courageous whistleblowers stood up to the Swiss banks and exposed how the banks helped U.S. millionaires and billionaires illegally evade taxes.  These whistleblowers won a hard fought victory in Tax Court—which ruled that whistleblowers who report criminal violations of the tax laws are fully protected under the IRS whistleblower program.

Prior to this decision, there was ambiguity about whether “collected proceeds” from criminal violations would be included in calculating IRS whistleblower rewards. The consequences of this Tax Court decision on the issue are massive. The largest tax fraud cases inevitably include criminal fines and penalties, and are often primarily criminal in nature. If criminal violations were excluded from the whistleblower reward calculation, the IRS program would not incentivize those whistleblowers with the most important information about the largest tax evasion schemes to report violations.


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In a press release issued today, attorneys for a husband and wife tax fraud whistleblowers, expressed optimism that President Trump’s pick for Secretary of Treasury Steve Mnuchin would show support for the IRS Whistleblower Office by not appealing a the Tax Court’s decision in Whistleblower 21276-13W v. CIR (147 TC 4).

The full press release is reprinted below:
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January 19th, 2017, today, the Senate Finance Committee held a hearing to consider President-Elect Trump’s pick for the Secretary of the Treasury, Steven Mnuchin. The National Whistleblower Center asked its supporters to insist that the Senators of the Finance Committee use the hearing to find out whether or not Mr. Mnuchin was committed to protecting whistleblowers who report to the IRS.

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The  following is an editorial from the National Whistleblower Center:

On August 3, 2016 the U.S. Tax Court ruled that tax whistleblowers were entitled to a reward based on monies collected in criminal fines and penalties. This landmark decision reversed the position of the Department of Treasury that severely limited the “collected proceeds” upon which a whistleblower reward could be based.
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On Wednesday, April 20, the Senate Finance Committee approved provisions put forward by Sen. Chuck Grassley to fix IRS whistleblower treatment and improve taxpayer rights.

“The IRS needs to put out the welcome mat for tax fraud whistleblowers, not treat them like skunks at a picnic,” Grassley said. 
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